Simple and wrong: a customer does not repay a loan on time
More complex and less wrong: x days after a load repayment was due, a customer still has not repaid.
Example of code erosion: https://github.com/munichpavel/risk-ai-workshop/issues/16. Without automated testing and regular updates of software dependencies in development mode, get hit with a huge price-tag (not good metaphor, would be pricetag with sum being more than sum of individual summands, concavity)
Contents
What is credit default in practice?
Simple and wrong: a customer does not repay a loan on time More complex and less wrong: x days after a load repayment was due, a customer still has not repaid.
Risk mgmt -- modeling
Risk mgmt -- software
Why?
Example of code erosion: https://github.com/munichpavel/risk-ai-workshop/issues/16. Without automated testing and regular updates of software dependencies in development mode, get hit with a huge price-tag (not good metaphor, would be pricetag with sum being more than sum of individual summands, concavity)